AerCap's Q1 earnings dip to $68m

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Operating lessor AerCap reported first quarter adjusted net income of $68 million, down slightly from a profit of $69.1 million in the year-earlier period, driven by the sale of its ALS portfolio, partially offset by income generated from new aircraft purchases during the period.

The net impact from aircraft sales and purchases during the past year also resulted in a decreases in basic lease rents and net spread in the first quarter, says the lessor in an earnings statement today.

Basic lease rents were $212.9 million for the first quarter, a decrease of 9% compared with the same period in 2012. Average lease assets decreased 6% to $7.4 billion compared with the first quarter of 2012.

Basic rents, maintenance rents and other receipts, or total lease revenue, for the quarter declined 10% to $226.8 million.

Net gain on the sale of assets for the first quarter was $11 million, compared with a $0.2 million loss for the same period in 2012.

The lessor ended the quarter with total owned assets of $8.6 billion as of 31 March, down 7% from the prior-year quarter, due to the sale of the ALS portfolio (now a managed asset), partially offset by new aircraft deliveries.

Aengus Kelly, chief executive officer of AerCap, says: "The combination of our asset sales over the course of the last 12 months at or above book value and subsequent purchase of our shares at a deep discount to book value has driven our earnings per share up by 22% year on year. This disciplined approach to both investing in and divesting of aircraft is a key pillar of AerCap's industry leading results."

AerCap's chief financial officer , Keith Helming, adds: "We are encouraged by the company's financial performance in the first quarter of 2013, as the company's liquidity profile remains robust...The company is extremely well positioned to take advantage of accretive investment opportunities that may arise throughout the balance of 2013."

The blended effective tax rate during the quarter increased to 8% from 5.2%.

The lessor had an unrestricted cash balance at quarter-end of $375.4 million, and an undrawn working capital facility of $290 million.